In June, retail sales experienced a decline attributed to election uncertainty and adverse weather conditions, based on data from the Office for National Statistics (ONS).
- Retail sales fell by 1.2% overall, with textile, clothing, and footwear seeing a 1.6% decrease.
- Online sales in these sectors slumped by 5.4% during the quarter.
- Non-food store sales volumes dropped by 0.5% when comparing quarter-to-quarter data.
- Despite these declines, falling inflation is seen as a potential relief for household expenses.
Retail sales in the United Kingdom encountered a significant downturn of 1.2% in June, according to the latest figures from the Office for National Statistics (ONS). This period’s performance was notably affected by the prevailing election uncertainty and unfavorable weather conditions, which contributed to reduced footfall and consumer spending.
The textile, clothing, and footwear sectors were particularly hard-hit, registering a 1.6% decrease in sales. The trend extended to the online space, where these sectors faced a more pronounced decline of 5.4% over the quarter. This decline in online sales underscored the broader challenges facing the retail industry amid changing consumer behaviors and economic uncertainties.
Non-food store sales volumes reflected a 0.5% decrease when comparing the quarter of April to June 2024 with the prior quarter from January to March. This further exemplifies the dampening effect of external factors such as political events and inclement weather on consumer activity.
Moreover, the broader economic context highlighted a complex scenario. Average regular earnings growth cooled to 5.7% in the three months leading up to May, while the unemployment rate held steady at 4.4%. The job market faced additional strain with 30,000 fewer job vacancies, bringing the total to approximately 889,000 during the quarter ending in June.
However, there is a silver lining as inflationary pressures appear to be easing. The latest Consumer Price Inflation (CPI) data revealed a constant headline inflation rate of 2%, while food inflation saw a slight reduction to 1.5%. According to Kris Hamer, from the British Retail Consortium, households could start to feel the benefits of these adjustments with reduced prices for goods like food, clothing, and footwear.
Despite the challenges faced in June, the easing inflation offers hope for improved economic conditions ahead.
